DawgTalkers.net Forums DawgTalk Tailgate Forum Bailout ???

I don't see how what you're saying proves that there isn't a double standard. You're saying that the general public wanted this money just handed over, no questions asked?

And the bill passed in the Senate by a vote of 74-25. The bill initially failed in the House by a vote of 228-205. Among Democrats, 140 voted in favor and 95 against. Among Republicans, 65 voted in favor and 133 against.

It then passed in the House by a vote of 263-171. Among Democrats, 172 voted in favor and 63 against. Among Republicans, 91 voted in favor and 108 against.

And it was the Senate who pushed through the bank bailout in very quick time. Then, the automakers come through and the Senate beats the crap out of them.

What I'm saying is, why didn't the Senate hold a hearing before the bank bailout?

The sub-prime problem and the credit crisis were the result of borderline criminal actions by the banks. The auto industry problem is the result of bad business practices. So, we should send the message that if we line the pockets of the banks, that's ok, but we should punish a place of business that has a strong union showing?

And, once again, people complain about the salaries that union members make, but no one has yet brought up the complaint that people working at banks make too much money.

Hence, IMO, double standard.

And to think people ae blaming the Autoworkers making $60 K a year


KING

If ever there should be the death penalty for something other than murder, Madoff should be the test case. A 50 Billion dollar ponzi scheme?? Are you freaking kidding me??

I just read this article regarding this pos....

http://www.marketwatch.com/news/story/ho...dist=TNMostRead

BOSTON (MarketWatch) -- For much of my life, the name Bernie Madoff has meant nothing to me. Now, however, it means far more than it should in my household and countless others across America. In my household, the net effect of the Madoff scheme is that my wife has lost all the money in her 401(k) account and her job as well.

But that's only part of the story. She worked at a private foundation that shut its doors last Friday, its assets -- all of which were "managed" by Madoff's firm -- frozen by court order.

The head of the Robert I. Lappin Charitable Foundation spent his hard-earned money on a cause that affected thousands of people who lived in the Jewish community north of Boston. And now, that cause -- in the absence of anyone or any group of people and organizations stepping up -- will become a memory instead of a legacy.

Red flags missed
My personal story with Madoff begins this way. Some years ago, my wife signed up for a 401(k) at work. I didn't pay much attention to her retirement account until earlier this year, after the 2007 year-end performance numbers were reported. Her account was up, not significantly but more than other retirement accounts.

Curious, I tried to learn more about her employer's 401(k) plan provider, the Bernard L. Madoff Investment Securities LLC. Unfortunately, I found little information about the firm on its Web site, nor on the Securities and Exchange Commission and Financial Industry Regulatory Authority (FINRA) Web sites. So, I dropped the matter, failing to take note of what, in retrospect, was one of the red flags.

Like most 401(k) statements, it listed employee contributions, employer contributions, amount vested, percent increase over the previous period and total value. But what the statement didn't contain was any footer with the usual legal mumbo jumbo, no mention of SIPC insurance, or the broker-dealer through which securities are cleared, or anything that is normally found on 401(k) statements. Nor did the statement contain the names of any listed securities or mutual funds.

Fast forward to October of this year. Her 401(k) statement for the nine months ended September 2008 arrives and once again the account was up 6% or so -- it's hard to tell exactly. Now, I'm thinking that maybe her 401(k) plan provider is the Joe Kennedy of his time. He's the one guy who's making money in a down market, he's the guy on the other side of the trade. He's the next Bill Miller or Peter Lynch. In fact, my wife and I even discussed upping her contribution to her 401(k) plan given what's his name's success.

Then last Thursday evening I am with two other gentlemen -- a professor and money manager -- at a holiday party. The money manager asks whether we read the news about Madoff. No, I say, thinking the name Madoff rings a bell but I can't place it. The money manager relates the story. "Madoff," the professor asks. "Oh my God, I think my sister has her life savings with that guy," he says.

He borrows the money manager's phone to call his sister and returns ashen-faced. His sister has lost her life savings. The money manager and I offer the professor our condolences. I tell him about Securities Investor Protection Corporation and the possibility of his sister getting some of her money back. But really there are no words of comfort, except "there but for the grace of God go I."

I return home from the party and tell my wife about the "Madoff story," about the professor, about how sad he looked, about how terrible it all is on top of everything else.

For whom the bell tolls
Bob, she says, Madoff is the guy who runs our 401(k). Oh s*#t, I say. The connection is made. We begin to read the stories on the Wall Street Journal, on MarketWatch, on every media outlet and blog possible. Does this mean what I think it means, my wife asks. Yes, I say. You've lost everything in your 401(k). And then my wife asks the question about the elephant in the room. What if the foundation's money was with Madoff? My wife emails her boss to no avail.

After a sleepless night, Friday morning arrives. There's an email from my wife's boss with a timestamp of 5 a.m. My wife rushes to work. By 10 a.m., I get a tearful call. The entire staff has been laid off and all the foundation's programs have been terminated. Their money and a lot of other people's money is gone. And all because of this guy Madoff, who wasn't happy with enough.

In some small way, I feel better knowing that plenty of big-name investors got duped as well. I'm angry with myself for not questioning the statements and the performance more closely, for not asking my friends at the SEC or other experts to give things a once over. But even then, I'm not sure what good it would have done. Plenty of people, more important than me, raised red flags to no avail.
With hope, my wife and I will survive this setback. We may or may not recover her 401(k) money. She may or may not land the same kind of job.

Oddly, that's almost irrelevant in the scheme of things. Thousands upon thousands of people put their trust in someone who didn't deserve that trust. And the collateral damage caused by that misplaced trust is not yet fully known and may never be fully known. Read about the lawsuits that are likely to ensue from the Madoff scheme.

"I hope he fries in hell," the professor writes in an email to me. And though Bernie Madoff has been a household name for a couple days now, so do I, so do I.

Robert Powell has been a journalist covering personal finance issues for more than 20 years, writing and editing for publications such as The Wall Street Journal, the Financial Times, and Mutual Fund Market News.

Isn't it amazing the level people will stoop to for a buck.. worst part of it is, what the hell could he actually do with 50 Billion bucks... my god, I could live to be a thousand years old and never spend it all And I am not a cheapo.... you won't find me turning 4 ply toilet paper into 2 ply

seriously,, it's a damn shame,, some of those that lost money were charities that do good works.. amazing... simply amazing

It's the Republicans being blamed for the loans not passing. It was the Republicans who initially stopped the Bank bailouts. After the initial bill failed they were inundated with calls back home telling them that the entire economy would immediately fall apart if it wasn't passed right away. They caved. The thing is the banks are still not loaning money and are economy is still here.

Now we have the big three crying wolf. Full me once, shame on you. Full me twice shame on me. It would be completely irresponsible to just loan the money to these guys. If they don't have some kind of business model that shows they can survive it is just throwing away money.

I don't see it as a double standard at all. I see it as some people in Congress coming to their senses. It probably is a moot point. Sounds like Bush is going to probably bail them out. If he doesn't the Dems will most likely be able to get the one or two Republicans to break any filibuster.

As far as blaming the union goes, it's not all their fault. These giant US companies are badly mismanaged and irresponsible when negotiating contracts. I do know that the long time union workers are well paid, especially if you count their benefits. Whether it's 60, 70 or 80 grand with benefits it's a ton of money when you factor in all the workers on the payroll. The top dogs have said they will work for a dollar. They should, they are at fault and can afford it. I don't know what the salaried employees are giving up but I bet it will be quite a bit.

Here's what it ultimately boils down to. The union fight the fact they will be forced to take huge cuts. If the president doesn't step in it will force the companies to file bankruptcy. It won't matter anymore what the union thinks because the will no longer have any say. I think it would be smarter to take their lumps now and take less of a hit if the companies file bankruptcy. If the companies prosper again they will be in much better position to gain money back.

I

Well, I respectfully disagree. I think it is a double standard. But your argument certainly makes sense.

On a side note (not replying to you), I thought this was an interesting read:

Executive Pay Limits May Prove Toothless
Loophole in Bailout Provision Leaves Enforcement in Doubt

By Amit R. Paley
Washington Post Staff Writer
Monday, December 15, 2008; A01

Congress wanted to guarantee that the $700 billion financial bailout would limit the eye-popping pay of Wall Street executives, so lawmakers included a mechanism for reviewing executive compensation and penalizing firms that break the rules.

But at the last minute, the Bush administration insisted on a one-sentence change to the provision, congressional aides said. The change stipulated that the penalty would apply only to firms that received bailout funds by selling troubled assets to the government in an auction, which was the way the Treasury Department had said it planned to use the money.

Now, however, the small change looks more like a giant loophole, according to lawmakers and legal experts. In a reversal, the Bush administration has not used auctions for any of the $335 billion committed so far from the rescue package, nor does it plan to use them in the future. Lawmakers and legal experts say the change has effectively repealed the only enforcement mechanism in the law dealing with lavish pay for top executives.

"The flimsy executive-compensation restrictions in the original bill are now all but gone," said Sen. Charles E. Grassley (Iowa), ranking Republican on of the Senate Finance Committee.

The modification reflects how the rapidly shifting nature of the crisis and the government's response to it have led to unexpected results that are just now beginning to be understood. The Government Accountability Office, the investigative arm of Congress, issued a critical report this month about the financial industry rescue package that said it was unclear how the Treasury would determine whether banks were following the executive-compensation rules.

Michele A. Davis, spokeswoman for the Treasury, said the agency is working to develop a policy for how it will enforce the executive-compensation rules. She would not say when the guidance would be issued or what penalties it might impose. But she said the companies promised to follow the rules in contracts with the department.

The final legislation contained unprecedented restrictions on executive compensation for firms accepting money from the bailout fund. The rules limited incentives that encourage top executives to take excessive risks, provided for the recovery of bonuses based on earnings that never materialize and prohibited "golden parachute" severance pay. But several analysts said that perhaps the most effective provision was the ban on companies deducting more than $500,000 a year from their taxable income for compensation paid to their top five executives.

That tax provision, which amended the Internal Revenue Code, was the only part of the law that contained an explicit enforcement mechanism. The provision means the IRS must review the pay of those executives as part of its normal review of tax filings. If a company does not comply, the IRS can impose a tax penalty. The law did not create an enforcement mechanism for reviewing the other restrictions on executive pay.

If a firm violates the executive-compensation limits, department officials said, the Treasury could seek damages, go to court to force compliance, or even rescind the contracts and recover the bailout money. "We therefore have all the remedies available to us for a breach of contract," Davis wrote in an e-mail.

Legal experts said those efforts could be complicated if the Treasury outlines the penalties after companies have received bailout money. David M. Lynn, former chief counsel of the Securities and Exchange Commission's division of corporation finance, said courts have sometimes placed limits on the government's ability to impose penalties if there was no fair warning.

"Treasury might find its hands tied down the road," said Lynn, who is also co-author of "The Executive Compensation Disclosure Treatise and Reporting Guide."

Congressional leaders are also concerned that the Treasury might simply choose not to enforce the rules or be unwilling to impose financial penalties that could further weaken a firm and send the economy deeper into a tailspin.

The Bush administration at first opposed any restrictions on executive pay, congressional aides said. The original three-page bailout proposal presented to lawmakers in September contained no mention of such limits. "Treasury was pretty clear that they thought doing this exec-comp stuff would limit the effectiveness of the program," said a Democratic congressional aide involved in the negotiations, who, like others interviewed for this story, spoke on condition of anonymity. "They felt companies might not take part if we put in these rules."

Congressional leaders disagreed. By the morning of Saturday, Sept. 27, the final day of marathon negotiations on the bill, draft language relating to taxes and containing the enforcement provision applied to all companies participating in the bailout programs, Democratic and Republican congressional aides said. But then Treasury Secretary Henry M. Paulson Jr. and his deputies began pushing for the compensation rules to differentiate between companies whose assets are purchased at auction and those whose assets or equity are purchased directly by the government, the aides said.

Congressional leaders from both parties thought Paulson wanted the distinction for extraordinary cases like American International Group, which the government seized in September. He wanted to be able to push executives out of companies that the government controlled and have the flexibility to bring in strong new executives, said one senior congressional aide.

"The argument that they were making at the time is that the direct investment was going to be used only in circumstances where the company was AIGed, so to speak," said a senior Democratic congressional aide.

Davis, the Treasury spokeswoman, confirmed that the Treasury pushed to place fewer restrictions on executives at companies receiving capital infusions, but she gave a different explanation. She said many of those firms are more stable and are being encouraged to participate in the bailout to strengthen the overall system. "The provisions for failing institutions should come with more onerous conditions than those for healthy institutions whose participation benefits the entire system," she said.

Lawmakers agreed to the Treasury's request that the measure apply only to executives at companies whose assets were bought by the government through auctions. In the executive-compensation tax section, a new sentence saying that eventually was inserted.

Meanwhile, Paulson repeatedly told lawmakers that he did not plan to use bailout funds to inject capital directly into financial institutions. Privately, however, his staff was developing plans to do just that, Paulson acknowledged in an interview.

Although lawmakers hailed the rules as unprecedented new limits on executive pay, several were unhappy that the law was not stricter.

Under pressure from Congress, the Treasury issued regulations in October on executive compensation and applied the tax-deduction limits to all companies receiving bailout funds, although the legislation did not require it for firms that received direct capital injections. But the Treasury failed to issue guidelines requiring the IRS or any other agency to enforce the rules, and it also failed to explain how the restrictions would be enforced.

The Treasury's regulations also instructed firms to disclose more compensation information to the Securities and Exchange Commission. But officials at the SEC do not think they have the authority to force companies to disclose the kind of pay information required by the bailout law, according to people familiar with the matter, though they hope companies will cooperate. John Nester, an SEC spokesman, declined to comment.

Senators on the Finance Committee have expressed concern to Paulson and are now considering whether they should amend the law to apply the enforcement mechanism to all firms participating in the bailout.

link

I guess I'm simple minded or something... I just don't get it I guess.

Why is it so hard to do the right thing.. why do politics have to play a part in every stinking decision.

You know, we elect these people to do a job for us.... FOR US... they don't work for themselves,, they work for US.. How come we don't have a mechanism in place where we can see they do something really stupid, and we can walk in and fire them?

I know when I worked for someone,, they could fire me at the drop of a hat if they so desired. Why can't politicians be the same..

Never mind, I know the answer, I'm just fed up with being promised the world and getting mud thrown in my face....